Advice / Advisers / Industry / Licensees

‘Happy client, happy life’: how GPS Wealth took top honours

Grahame Evans, GPS Wealth

It’s a sobering thought to those who, like GPS Wealth managing director Grahame Evans, have been in and around the financial advice industry for a while, but many advisers in the GPS network – and other networks, no doubt – have never experienced working through a recession before now.

The average age of a GPS adviser is mid-40s, meaning that during the recession of mid-1990 today’s average GPS adviser was still a teenager. Helping advisers navigate the likely economic conditions ahead, not to mention helping them cope with the pressures presented by the COVID-19 pandemic and a rapidly restructuring advice industry, will require effective communication, strong leadership and a clear perspective, Evans says.

“You need to be conscious and aware of what advisers
are actually going through and try to help them.”

Grahame Evans, GPS Wealth

“It’s absolutely necessary to have balance in what you’re doing, and to make sure you don’t lose sight of what the longer-term goal is, which is to support your advisers to give quality financial advice,” he says.

“What we’ve seen in this 12-month period is a time when we’ve had unusual circumstances such as COVID; and we’ve had a changing marketplace as a result of increased legislation, brought about by the royal commission more than anything, and people starting to exit from the market because of the risk-return relationship that exists in licensee-adviser land these days. You need to be conscious and aware of what advisers are actually going through and try to help them.”

The CoreData 2020 Licensee of the Year

In 2020 GPS was judged the best licensee in the country, based on the ratings provided by its own advisers. It was named CoreData’s 2020 Licensee of the Year, as well as the 2020 Independently Owned Licensee. 

Evans says the past 12 months or so has been a time when financial advisers have really appreciated a licensee that tries to “treat people fairly in an environment where it seemed to be all about being the policeman, or policeperson, when we’re not”.

“We are there to help advisers give clients quality advice, and we’ve got to consider all aspects of that,” he says.

“We are there to help advisers give clients quality advice,
and we’ve got to consider all aspects of that.”

Grahame Evans, GPS Wealth

“It’s not just about black-letter law, it’s about intention and attitude. It’s about ensuring  advisers engage effectively with clients. We believe that it’s all about empowerment of clients.”

Evans says GPS is “an equity business”, meaning that in all its dealings it seeks to treat people fairly.

“We have our weak points, which I am sure are evident in the research, but on the whole, most of our advisers would think we do what we can to make the situation easier for them to engage effectively and deliver that quality advice,” he says.

Evans’ verdict: Could do better

Evans is in no doubt where GPS can do better as a licensee to support its advisers – and it’s primarily on the technology front.

“We do not have a 100-man Xplan team to build threads for everything,” he says. 

“I’d love to be able to do that. But on balance, we’ve been more focused on the engagement end than we have on building every thread for every different way an adviser may do something.”

Evans says GPS’s ultimate goal was to be ambivalent about the customer relationship management (CRM) and modelling tools its advisers use, and to allow its advisers to choose whichever they believe suits them best.

“We’re only interested in those systems from a record-keeping perspective,” he says.

“The future from our perspective is extracting data from those and warehousing data to make sure they’ve done their FDS, they’ve done their opt-in, they’ve done their annual reviews, their file structure is strong. That’s from a compliance perspective.

“I’m a firm believe that where
the value is added is closest to the client.”

Grahame Evans, GPS Wealth

“On the other side it’s about helping them with their marketing. I’m a of a firm belief that where the value is added is closest to the client. If we can help our advisers engage better with the client, the client responds. They’re happy because they feel empowered. Happy client, happy life.”

GPS sits in what CoreData describes as the mid-tier of licensees with between 100 and 500 authorised representatives on their licences. Evans says the challenge facing this tier is to continue to attract the right advisers to the fold and to ensure they remain adequately resourced to support the advisers they take on. 

The key question is: are you recruiting advisers for the right reasons, and in the right way? Offering discounted or non-commercial fee arrangements isn’t sustainable.

“This hyena approach to recruiting, a really scavenging type of approach, doesn’t do the industry any good,” he says.

The old way of doing things is long gone

Evans says advisers and licensees need to accept that the old way of doing business is over. Advisers need to learn how to articulate their advice offer to clients and charge an appropriate fee for service; and licensees need equally to learn how to articulate their offer to advisers and charge an appropriate fee for service.

“The risk for the mid-tier licensees is they go out and recruit anything that when you put them up next to a mirror it fogs it up,” Evans says.

“If you have a value proposition and you have a strategy and you’ve got market segments that you think work with your business, stick to it. Don’t compromise. It’s going to lead to people you don’t want to work with and people who have different values and belief systems, which could compromise your compliance process. That’s one of the biggest risk at this point in time.”

“If ASIC made very non-institutionally owned licensee with 100 advisers or more go and do a look-back on every bit of advice and ongoing service, it probably would send some of them to the wall.”

Grahame Evans, GPS Wealth

Evans says mid-tier licensees need also to learn how to deal with the regulator, and with the consequences of regulatory scrutiny. It may be true that the greatest attention has so far been paid to institutions, but that will change. 

“The world knows that if ASIC made every non-institutionally owned licensee with 100 advisers or more go and do a look-back on every bit of advice and ongoing service, it probably would send some of them to the wall,” Evans says.

“But I honestly believe most of those business don’t have the inherent  structural issues which has caused the billions in remediation. We do not have the billion-dollar budgets that other large organisations do. The most important thing for advisers and licensees to do is if you detect something , dig deeper. Don’t necessarily dig deeper for the whole business, but determine when you find something wrong, and then dig deeper. 

“I’m of the view that it’s absolutely important that people are set up and structured to be able to deal with client remediation, and again, being fair and equitable about things. We all know when people are trying it on, and we also know when people have been hardly done by – and we need to fix those issues.”

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